When a landowner gives another person or entity the right to use and develop land, this is known as a Musataha right. The Musataha holder has the right to develop buildings or structures for an agreed period on that land, while the landowner continues to own the land. The legal framework governing Musataha in the UAE is principally found in Federal Decree-Law No. (25) of 2025 Promulgating the Civil Transactions Law, which came into force on 1 June 2026, together with applicable emirate-level legislation. In Dubai, Musataha rights over certain commercial and industrial land are specifically regulated by Decree No. (23) of 2022 Regulating the Grant of Musataha Rights over Commercial Land in the Emirate of Dubai. Accordingly, while the Civil Transactions Law provides the broader legal foundation for Musataha as a real right, Decree No. (23) of 2022 governs Musataha rights over certain commercial land in Dubai.

What Is a Musataha Right?

Article 1254 defines Musataha as a principal real right granted by the property owner to the Musateh, allowing the latter to construct buildings or plant on the land. Ownership of the property remains with the landowner, while the Musateh has the right to use the property for a prescribed period.

Registration Is a Critical Requirement

A Musataha is created through a contract between the owner and the Musateh, setting out their respective rights and obligations. Following the signing of the contract, it must be registered with the competent authority. The Civil Transactions Law provides that an unregistered disposition shall be deemed void. Accordingly, until and unless the Musataha is properly registered with the competent authority, it will not be valid.

What Should a Musateh Check?

Before investing in the property, the Musateh should verify:

  1. whether the Musataha has been registered;
  2. whether the registered details correspond with the contract;
  3. the identity of the registered owner and Musateh;
  4. the duration of the right;
  5. the permitted use of the property; and
  6. whether any other registered rights or restrictions affect the Musataha.

The Contract Should Clearly Define the Rights and Obligations of the Parties

Article 1255 specifically states that the contract should clearly specify the rights and obligations of the owner and the Musateh.

The agreement should clearly address:

  1. the purpose for which the property may be used;
  2. the duration of the Musataha;
  3. the consideration payable;
  4. construction and development obligations;
  5. applicable completion deadlines;
  6. rights relating to buildings and improvements;
  7. assignment and mortgage;
  8. termination;
  9. renewal;
  10. consequences of expiry; and
  11. the treatment of buildings, facilities and improvements when the Musataha ends.

What can the Musateh do with the property?

The rights provided under the agreement do not give the Musateh unlimited freedom to use or develop the land. Under Article 1257, the Musateh is required to:

  1. use the property for the purposes specified in the contract;
  2. complete the agreed buildings and facilities within the specified timeframes;
  3. obtain the required approval before changing the purpose for which the land is used; and
  4. refrain from any disposition that could harm the property owner or prejudice the use of the land after the Musataha expires.

This is also reflected in the Dubai framework, where the holder is required to use the commercial land only for the purpose specified in the contract. If there is a change in the intended use of the land, it may require the approval of the property owner or the competent authority, as applicable.

How long does a Musataha right last?

Article 1258 provides that the term of the Musataha is determined by agreement between the parties and must be specified in the contract.

The parties should clearly establish:

  1. the commencement date;
  2. the expiry date;
  3. the total duration;
  4. whether renewal is possible;
  5. the procedure for renewal; and
  6. how much advance notice is required for renewal.

What happens when the Musataha expires?

Article 1261 states that ownership of the buildings, facilities, plantings and improvements made with the approval of the property owner will revert to the property owner upon expiry of the Musataha period, unless otherwise agreed. The agreement should clearly state what happens upon expiry and who will have ownership of the buildings and improvements.

The parties should consider addressing:

  1. ownership upon expiry;
  2. whether compensation is payable;
  3. responsibility for the condition of the property;
  4. treatment of improvements; and
  5. any agreed alternative arrangement.

What if the Musateh builds without the owner’s approval?

If the Musateh fails to obtain the owner’s approval before developing the land, Article 1261 provides the property owner with certain rights in relation to the unauthorised structures, including requesting their removal and seeking compensation where applicable. If removal would cause damage to the property, the owner may acquire ownership of the structures for their value.

Can the Musataha right be Sold, assigned or mortgaged?

Article 1256 provides that the Musataha right:

  1. passes by inheritance or will;
  2. may be assigned;
  3. may be mortgaged as security; and
  4. may have easement rights created over it, provided that they do not conflict with its nature.

Where an assignment or mortgage is contemplated, the applicable contractual and legal requirements, including any required approvals, should be observed.

What happens if the Musateh stops paying?

Article 1260 provides that the Musataha contract may terminate if the Musateh fails to pay the agreed consideration for a period of six months, unless the parties have agreed otherwise.

When can a Musataha contract end?

Article 1260 identifies several circumstances in which the Musataha contract terminates:

  1. expiry of the agreed term without renewal;
  2. agreement of the parties to terminate;
  3. a court judgment terminating the Musataha;
  4. merger of the capacities of owner and Musateh; and
  5. failure to pay the agreed consideration for six months, unless otherwise agreed.

Conclusion

A Musataha right provides a legal mechanism for developing and using land while ownership of the underlying land remains with the landowner. Given the long-term nature and financial significance of Musataha arrangements, the rights and obligations of both parties should be clearly documented and the applicable registration requirements carefully observed. Particular attention should be given to the duration, permitted use, development obligations, transfer or mortgage rights, termination and the treatment of buildings and improvements upon expiry. Proper legal review at the outset can help minimise disputes and protect the interests of both the landowner and the Musateh.

We at Ayesha Aldhaheri Advocates and Legal Consultants, we assist clients in drafting and reviewing Musataha agreements and advising on the rights and obligations arising from such arrangements.